A report from Mortgage News Daily. "Mortgage delinquencies spiked in June and the serious delinquency rate, loans 90 or more days past due but not in foreclosure, reached its highest level in more than five years. CoreLogic predicts that, barring additional government programs and support, serious delinquency rates could nearly double from the June 2020 level by early 2022. Not only could millions of families potentially lose their home, through a short sale or foreclosure, but this also could create downward pressure on home prices - and consequently home equity - as distressed sales are pushed back into the for-sale market."

"'Sustained unemployment has pushed many homeowners further down the delinquency funnel, culminating in the five-year high in the U.S. serious delinquency rate this June,' the report says, 'With unemployment projected to remain elevated through the remainder of 2020, we may see further impact on late-stage delinquencies and, eventually, foreclosure.'"

"All states logged annual increases in both overall and serious delinquency rates in June with those hit hardest by the pandemic showing the most damage. In New Jersey and New York serious delinquent rates were up 3.7 and 3.6 percentage points, respectively. Nevada's rate rose 3.4 points and Florida's by 3 points. Similarly, all U.S. metro areas logged at least a small increase in serious delinquency rate in June. Miami and Atlantic City, both hard hit by the collapse of the tourism market saw increases of 5.1 and 4.3 points while energy dependent markets such as Odessa, Midland, and Laredo Texas had similar increases."

From DS News. "Not only could millions of families potentially lose their home, through a short sale or foreclosure, but this also could create downward pressure on home prices—and consequently home equity — as distressed sales are pushed back into the for-sale market. 'Three months into the pandemic-induced recession, the 90-day delinquency rate has spiked to the highest rate in more than 21 years,' said Dr. Frank Nothaft, Chief Economist at CoreLogic. 'Between May and June, the 90-day delinquency rate quadrupled, jumping from 0.5% to 2.3%, following a similar leap in the 60-day rate between April and May.'"

From Bloomberg. "The U.S. mortgage market shows a widening gap between winners and losers as affluent borrowers take advantage of record-low rates while protracted unemployment drives serious delinquencies to their highest levels since 2010. About 2.25 million mortgages were at least 90 days late in July, a 450% increase from pre-pandemic levels and the biggest number since the global financial crisis, according to industry tracker Black Knight Inc."

"More borrowers with ability to refinance are using their equity to get cash. About $44.5 billion in equity was tapped through cash-out refinancing in the second quarter, the most in more than a decade. Markets with the biggest delinquency increases in July were Miami, Las Vegas, Orlando, New York and New Orleans."

The Boston Herald in Massachusetts. "An exodus of apartment dwellers from some pricey zip codes in Cambridge and Boston during the pandemic has driven down prices by about 7%. 'It’s really a good time to be a renter. You can get a great apartment in Fenway, Back Bay or Beacon Hill for Allston-Brighton prices,' said rental agent Mark Coronado. Landlords are 'panicking' — dropping prices and cutting deals as the market remains flooded with apartments even after Boston’s busiest move-in day, Sept. 1, he said."

The Providence Journal in Rhode Island. "Landlords are feeling the pain and worry more is to come in the months ahead following the Trump administration’s imposition of a moratorium on evictions for tenants who say they are unable to pay their rent due to the COVID-19 pandemic. 'It’s going to harm landlords. It’s going to kill some of them,' said Michael Crane, a Providence lawyer who represents private and public housing entities as well as so-called 'mom and pops,' owners of multifamily housing who rely on rent to help make their monthly mortgage."

"It’s those property owners, many of whom purchased multifamily houses in a bid to live out the American dream of home-ownership, who are likely to be the hardest hit, as a tenant’s missed rent can set the mortgage payment behind, he said. 'They are going to get slammed,' Crane said. He and others forecast a wave of foreclosures in the year ahead."

From KOIN in Oregon. "Mayor Ted Wheeler signed an executive order Monday extending the city’s eviction moratorium through the end of 2020. Portlanders are currently about $120 million behind on rent. The data from the Portland Housing Bureau showed 12-15% of Portland renters were unable to make rent in May. The highest rates of nonpayment were in outer Portland. There was about 15% nonpayment in June and 14% nonpayment in July."

From WKRN in Tennessee. "It’s a downward trajectory we’re not used to seeing in the metro– demand for Nashville rents is dropping. 'The employment situation is going to hurt demand and also the pandemic and nature of travel is going to stop people who would be moving there in the first place,' said Joshua Clark, Economist, Zillow Group. The lack of demand is forcing landlords to entice renters with concessions. 'When you’re talking about thousands of dollars, 25-percent off a years rent, things like that, ya, I think concessions are going to be effective in getting people to stay or into a vacant unit.'"

The Real Deal on New York. "Rating agencies in Israel are reassessing the creditworthiness of New York-based real estate developers trading on the country’s bond market. The latest company to face a ratings drop was Yoel Goldman’s All Year Management, whose four bond series all saw two-step downgrades from rating agency Midroog, according to a Sunday filing on the Tel Aviv Stock Exchange. The firm’s unsecured Series B and D bonds were downgraded from A3 to Baa2, while its Series C and E bonds — secured by the William Vale hotel complex and phase one of the Denizen Bushwick development — went from A2 to Baa1."

"That portfolio deal encountered a hiccup last week as All Year disclosed that the buyer, David Werner, had not paid the remainder of its deposit on time. Midroog has given All Year’s bonds a negative outlook due to these developments."

"All Year is far from the first New York City-based real estate firm to face scrutiny in these uncertain times. In late March, rating agency Maalot — an S&P Global subsidiary — downgraded Related Companies’ Israeli bonds from A+ to BBB in light of an impending maturity date. Extell Development’s bonds were also put on watch in late March, and in June Midroog officially downgraded the developer’s bonds by one level, from A3 to Baa1, with a negative outlook. The main reason for the move was the expected decline in the pace of condo sales, as well as prices, as a result of the pandemic. (Contracts for condos in Manhattan saw a nearly 38 percent year-over-year drop in August.)"

"Earlier in June, Midroog also downgraded Moinian Group’s bonds by two grades, from A1 to A3, with a negative outlook, citing the lack of sufficient liquidity to cover debt service requirements. The agency reiterated its negative outlook for Moinian’s bonds in a new filing last week."

The Philadelphia Inquirer. "Hundreds of investors hoping to recover $375 million from Philadelphia-based Par Funding should lower expectations that they will get back all of their investment, let alone make any money, a federal judge warned Tuesday. U.S. District Judge Rodolfo Ruiz, presiding over a fraud civil suit against Par Funding and others, raised troubling questions about the lender’s business model. Par Funding took in money from investors, paying them returns of up to 14%, and then lent out cash advances to businesses, charging punishing average interest rates of 50%."

"Denver developer Colorado Homes owes Par $25.5 million — money Par Funding is seeking to collect from the company in an ongoing lawsuit filed in Philadelphia Common Pleas Court in March. In a recent pitch to potential investors, owner Ranko Mocevic sought to raise $92 million for a suburban Colorado condo development and a nearly two-square-mile hemp farm, among other projects."

"Judge Ruiz said he had become skeptical of Par’s claim that it was a profitable company before the coronavirus shutdown slammed small businesses, cutting their sales and their ability to make loan payments. 'COVID may have accelerated an undergoing problem,' he said. He also backed away from what he said was his earlier hope that receivership could 'save this business and keep this operation going.' Instead, he asked, 'How much of a workable business model is left here?'"

The Santa Monica Daily Press in California. "The California law is important because it allows tenants to find a way back to financial balance, assuming they can find work, and get caught up on their other bills as well. How will that impact the landlords who right now are struggling to pay their mortgages while they are receiving drastically reduced, or in some cases eliminated, income. They will be filing for relief in the bankruptcy courts themselves in order to reorganize their debts. Will that impact property values? Most certainly."

"As the pool of distressed properties grows and come on the market for sale, that means that prices will start to drop, that can trigger lines of equity to be called on borrowers, who are then faced with coming up with large sums of cash, or they will have to liquidate their properties."

"Banks will be impacted by this domino effect of lost revenue, which is the lifeblood of our economy. As banks have to foreclose on properties and take them into their inventory, that means they will be experiencing losses, which lead to job cuts, increased holdings of devalued properties which they must then sell in order to keep their monies on hand high enough to satisfy the federal regulators. That means that even more properties will be sold at lower prices and now we have a downward spiral."

"What does this mean for Santa Monica? It’s already begun here. You may have noticed that there are many open stores on the Promenade. Sur La Table is having a going out of business sale due to the shutdown and the transition to online shopping. The number of For Lease signs are multiplying along Wilshire Blvd like rabbits. The loss of both foot traffic due to the stay at home orders and the transition to online shopping means that it’s more and more difficult for a retail shop to survive, which translates into lost revenue for the commercial property holders and that whole downward spiral is at play for them as well."

"There is a great shakeout coming in both residential multi-unit apartment buildings and in the commercial real estate market."

The Los Altos Town Crier in California. "A local real estate developer who invested in a major, city-approved housing project at 5150 El Camino Real is suing Dutchints Development LLC – the owner of the property that is facing several other lawsuits alleging unpaid debts and breach of contract – along with its managing director, Vahe Tashjian."

"Richard 'Tod' Spieker, president of Spieker Companies, manages nearly 3,000 multifamily units in Silicon Valley. In a lawsuit filed in Santa Clara Superior Court Aug. 18, Spieker said a $2.5 million investment he and his wife, Catherine, made in the development at 5150 El Camino was instead used to pay Dutchints’ and Tashjian’s existing debts and operational expenses."

"Three weeks ago, the Town Crier published a report on Dutchints – a Los Altos-based real estate developer involved in several major projects in Los Altos and the greater Bay Area – that found the group was being sued by several construction companies and investors for millions of dollars. Additionally, the Town Crier obtained records indicating that property owned by Dutchints adjacent to 5150 El Camino is in the process of being foreclosed."

The Los Angeles Times. "Greg Glassman couldn’t quite work out a profit in Hawaii. The CrossFit co-founder, who stepped down as CEO over the summer, just sold his coastal retreat for $5.65 million, or $100,000 less than what he paid for it four years ago. He originally sought $7 million for the property in December, according to the Multiple Listing Service."